The Current Account Switch Service was first launched in 2013 to offer a quick, hassle-free way to switch current accounts, with the promise that everything would be completed within seven working days.
It was intended to boost competition in the industry to ensure banking customers got the service they wanted, and by the looks of things, it's had the desired effect – not only are providers offering accounts that boast everything from cashback on everyday purchases to impressive levels of interest, but it seems that consumers are getting on board, too, with switching activity definitely on the rise.
Official figures from the service show that 309,678 switches took place during the first three months of the year, an increase of 20% from the final quarter of 2015, and 10% more than the same period a year ago. This could have a lot to do with the launch of a new public awareness campaign at the start of the year, and in fact, March 2016 saw the highest number of monthly switches (124,615) since the service launched.
This level of growth has been seen for much of the last year, with 11% more switches taking place in the final three months of 2015 than in the preceding three-month period, again coinciding with a high-profile media campaign launched in September. As a result of this clear focus on boosting consumer awareness, 71% of respondents were aware of the Current Account Switch Service at the end of last month, an increase of 13 percentage points since the scheme's launch.
Overall, more than 2.8m switches have taken place since the scheme's launch, with 1.06m of those in the last year alone. Although this marks a slight drop from the 1.13m switches that took place in the previous 12-month period, the recent growth rates suggest that switching could be boosted even further in the year ahead.
Additional figures from Bacs, the company behind the Current Account Switch Service, have revealed how much the market has improved in the years since its launch, with the service having a largely positive impact.
They pointed out that the total number of current accounts offered has grown and now stands at 143, up from 120 when last counted in 2011. At the same time, the number of banking providers offering current accounts has risen from 30 to 45, and since 2012, the Bank of England has granted licences to 21 new providers. Large retailers have entered the market, too, including Tesco and M&S, enhancing the landscape even further.
Not only that, but the figures show that banking providers are embracing innovation – an estimated 77 innovations have taken place in the sector since the scheme's launch – and complaints about current accounts have dropped notably, with FCA figures showing a 10% decrease in such complaints between July and December 2015.
Bacs' Michael Chambers said that, while the total number of switches taking place is indeed an important measure, an even more important one is the level of competition now present in the sector – and there certainly are some great options around these days.
Whether you're after an interest-paying account, want to get cashback on your purchases, are hoping to get preferential rates on mortgages and savings products or even want a package that can offer everything from travel insurance to breakdown assistance, you'll be able to find it. So, if you're not happy with your current account, check out our best buys to see the kind of options available, and you could soon be adding to the switching tally with a better deal to boot.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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